S P INTERNATIONAL vs. PRINCIPAL COMMISSIONER OF INCOME TAX 27 MUMBAI

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WP/3346/2024HC BombayHCBM01040684202307 August 2026Bench: HON'BLE SHRI JUSTICE B.P. COLABAWALLA,HON'BLE SHRI JUSTICE FIRDOSH PHIROZE POONIWALLA6 pages
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What did the High Court hold?

The High Court held that the approach adopted by the Revenue was hyper-technical. The delay in question pertained solely to filing a corrected Return by changing the nomenclature of the firm, while the original Return was filed within the statutory limitation. Crucially, the correction did not seek to alter the declared income, tax liability, or any substantive claim. The only correction involved adding the prefix "M/s." to the partnership firm's name. The Court found that the object of Section 119(2)(b) is to advance substantial justice and prevent genuine hardship, not to defeat legitimate claims on technical grounds. No prejudice was demonstrated to have been caused to the Revenue by condoning the delay. Refusal to condone the delay on such a technical ground resulted in the denial of substantive justice to the assessee. Therefore, the Court found sufficient cause for condoning the delay, considering the omission to be purely clerical and not affecting the assessment of income. The impugned order was quashed and set aside, the delay was condoned, and the Respondents were directed to treat the corrected Return as validly filed and process it accordingly.

What were the facts?

The assessee, S.P. International, filed a Writ Petition before the Bombay High Court challenging an order dated October 21, 2021, passed by the Principal Commissioner of Income Tax (Respondent No. 1) under Section 119(2)(b) of the Income Tax Act, 1961. The order rejected the assessee's application for condonation of delay in filing a corrected Return of Income for Assessment Year 2017-18, which was required under Section 139(9) of the Act. The Department opposed the petition, arguing that the assessee failed to establish genuine hardship and did not rectify the defect within the prescribed fifteen days after receiving a notice under Section 139(9). The assessee's original Return was filed within the prescribed time, with the only error being the description of the firm's name as "S. P. International" instead of "M/s. S. P. International."

What were the issues?

1. Whether the Principal Commissioner of Income Tax was justified in rejecting the assessee's application for condonation of delay in filing a corrected Return of Income under Section 119(2)(b) of the Income Tax Act, 1961, for Assessment Year 2017-18, when the delay pertained only to a clerical correction in the firm's nomenclature and not to income or tax liability? Assessee's Contention: The assessee argued that the delay was in filing a corrected Return, not the original Return, and the correction was a minor clerical error in the firm's name (omitting "M/s.") which did not affect income or tax liability. The assessee also highlighted a history of consistent timely filings and variations in the firm's name description in previous years. The assessee contended that the rejection was hyper-technical and denied substantive justice. Revenue's Contention: The Revenue contended that the assessee failed to establish genuine hardship warranting the exercise of powers under Section 119(2)(b). It was argued that the assessee was granted an opportunity under Section 139(9) to rectify the defect but failed to do so within the stipulated time, and the subsequent explanation was unsatisfactory. The Revenue emphasized that the power under Section 119(2)(b) is discretionary and requires proof of genuine hardship.

Which sections of the Income-tax Act were involved?

Section 119(2)(b),Section 139(9)

AI-generated summary — verify with the full judgment below

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO.3346 OF 2024 S.P.International .. Petitioner Versus Principal Commissioner of Income Tax, Mumbai & Ors. .. Respondents Mr.Ruturaj H. Gurjar, Advocate for the Petitioner. Mr.Swapna Gokhale, Advocate for the Respondents.

CORAM: B. P. COLABAWALLA & FIRDOSH P. POONIWALLA, JJ. DATE: AUGUST 07, 2026 P. C. 1. Rule. Respondents waive service. With the consent of the parties, Rule made returnable forthwith and heard finally. 2. The Assessment Year concerned is 2017-18. The present Writ Petition challenges the Order dated 21st October 2021 passed by Respondent No.1 under Section 119(2)(b) of the Income Tax Act, 1961, whereby the Petitioner's Application for condonation of delay in filing a corrected Return of Income under Section 139 (9) of the Act came to be rejected. Page 1 of 6 AUGUST 07, 2026 Mohite TRUSHA TUSHAR MOHITE Digitally signed by TRUSHA TUSHAR MOHITE Date: 2026.08.12 17:38:39 +0530

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3.

We have heard the learned Counsel for the parties and perused the material placed on record.

4.

By Reply dated 22nd February 2024, the Department has opposed the Petition by contending that the Petitioner failed to establish the existence of any genuine hardship warranting exercise of powers under Section 119(2)(b) of the Act. It is further submitted that, upon noticing a defect in the Return, a Notice under Section 139(9) of the Act was issued granting the Petitioner an opportunity of fifteen days to rectify the defect. Despite this opportunity, the Petitioner failed to cure the defect within the prescribed time. According to the Department, the explanation, subsequently furnished for such failure, was not found satisfactory, and therefore, the Application for condonation of delay came to be rejected. 5. To butteress the aforesaid contentions, the learned Counsel for the Respondents submitted that the power under Section 119(2)(b) is discretionary and can be exercised only upon proof of genuine hardship. In the present case, the Petitioner failed to demonstrate any such hardship. It was further submitted that a statutory opportunity under Section 139(9) had already been granted to rectify the defect in the Return, but the Petitioner Page 2 of 6 AUGUST 07, 2026 Mohite

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failed to avail of the said opportunity, and the explanation offered thereafter was found unacceptable by the Competent Authority. 6. Having heard the parties, we find that the undisputed facts reveal that the Petitioner had filed its original Return of Income within the prescribed time. The only error in the Return was with regard to the description of the name of the partnership firm. The Return was filed in the name "S. P. International" instead of "M/s. S. P. International." 7. It is not the case of the Revenue that there was any change in the Permanent Account Number, the constitution of the assessee, the income declared, or the tax liability. The correction sought was only in the nomenclature of the Firm. 8. The record further indicates that throughout the previous years the Petitioner had consistently filed its Returns within time. The description of the name of the Firm has not remained uniform over the years. In some years, the Returns were filed as "S. P. International", while in other years, they were filed as "M/s. S. P. International". A detailed chart demonstrating the Returns filed over the years was submitted by the Petitioner along with its Page 3 of 6 AUGUST 07, 2026 Mohite

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letter dated 24th September 2021 in support of the Application for condonation of delay. 9. The Department has also not disputed the fact that original Return for the relevant Assessment Year was filed within the prescribed time. Its principal objection is that the Petitioner failed to establish that the electronic portal was inaccessible or that there existed any technical impediment preventing the filing of the corrected Return within time. On this basis, the Application for condonation came to be rejected. 10. In our view, the approach adopted by the Respondent is hyper- technical, to say the least. The delay sought to be condoned pertains only to filing a corrected Return by changing the nomenclature. The original Return had already been filed within limitation. More importantly, the correction did not seek to alter the income returned, the tax liability or any substantive claim. The only correction related to the prefix "M/s." preceding the name of the partnership Firm. 11. The object of Section 119(2)(b) is to enable the authorities to grant relief where genuine hardship would otherwise be caused. The Page 4 of 6 AUGUST 07, 2026 Mohite

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provision is intended to advance substantial justice and not to defeat legitimate claims on account of technical or procedural lapses. 12. In the present case, no prejudice whatsoever, has been demonstrated to have been caused to the Revenue by condoning the delay. On the other hand, refusal to condone the delay merely because the corrected Return was filed beyond time, when the correction itself was confined to the nomenclature of the assessee, results in denial of substantive justice to the Petitioner on an entirely technical ground. 13. The Petitioner also pursued the matter by submitting representations and lodging grievances before the Department. The response received indicated that no further relief could be granted administratively and that the Petitioner would have to seek appropriate relief before this Court. Having exhausted the available remedies, the Petitioner has rightly invoked the writ jurisdiction of this Court. 14. Having regard to the facts and circumstances of the case, we are satisfied that sufficient cause existed for condoning the delay. The explanation furnished by the Petitioner cannot be said to be lacking in bona fides. The omission sought to be corrected was purely clerical in nature and Page 5 of 6 AUGUST 07, 2026 Mohite

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did not affect the assessment of income in any manner. We are therefore unable to sustain the impugned Order, and the same deserves to be quashed and set aside.

15.

Accordingly, the impugned Order dated 21st October 2021 passed by Respondent No.1, under Section 119(2)(b) of the Income Tax Act, 1961, is quashed and set aside. The delay in filing the corrected/revised Return is condoned. The Respondents are directed to treat the corrected Return as having been validly filed and to process the same in accordance with law, without being influenced by any observations contained in the impugned Order. 16. Rule is made absolute in the above terms and the Writ Petition is also disposed of in terms thereof. However, there shall be no order as to costs.

17.

This Order will be digitally signed by the Private Secretary/ Personal Assistant of this Court. All concerned will act on production by fax or email of a digitally signed copy of this Order. [FIRDOSH P. POONIWALLA, J.] [B. P. COLABAWALLA, J.] Page 6 of 6 AUGUST 07, 2026 Mohite

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